Meat & Livestock Australia chief executive Jason Strong did not hold back when questioned late last night during Senate Estimates in Canberra about recent debate over the accuracy about national beef herd size estimates.

Rural and regional affairs senate committee member Sen Susan McDonald led the questions on the topic, and gave MLA some questions on notice for future responses – particularly around methodology and herd data collection, and peer reviews of the modelling process.

We’ll publish those in summary once they are tabled by the committee.

Backgrounding the senator’s questions, Mr Strong said there had been a number of things that had significantly contributed to herd increase in the last number of years.

“Largely its favourable environmental conditions, with more rain and grass growth underlining the productivity of beef herds. But another contributor is lower turnoff, with processing numbers last year below six million cattle, down from eight million at the peak of the drought in 2019.”

The measure used as one of the indicators of whether the industry is in a build or liquidation phase was the proportion of females in overall slaughter. Anything over 47pc was the ‘bellwether’ for liquidation, he told the committee.

“It’s currently below 40pc. There’s a number of contributors to growing the herd, including this,” he said.

Sen McDonald asked whether workforce shortage in abattoirs had been a contributing factor to lower kill rates.

“It has been, but we’ve seen less cattle being turned off as well, with cattle retained to rebuild the herd,” Mr Strong said.

“The industry has a fantastic track record of responding to pretty much any challenge – and this is another of those. Last week we killed 108,000 head (see Beef Central’s Weekly Kill report), the highest number since mid 2020 – a significant improvement in turnoff in the last little while.”

Irresponsible commentary

Asked whether this was affecting domestic and international markets, Mr Strong said it was not, at this stage.

“But there’s been some incredibly irresponsible commentary around the herd numbers, from a specific commentator who has a track record of trading on fear and anxiety,” he said.

“They (he) was also behind a lot of the really unnecessary commentary last year around exotic animal diseases, and talking down the cattle price when it has been really high.”

Mr Stong’s comments did not mention anyone by name, but were clearly targeted at independent analyst Simon Quilty from Global Agritrends, who has spoken to more than 5000 livestock producers at various forums, conferences and webinars across Australia over the past year, at the invitation of a wide range of prominent industry organisations and private companies.

Mr Quilty provides market intelligence on a subscription basis to more than 800 key industry stakeholders across Australia, New Zealand, the United States and elsewhere.

He points out that as an analyst he is truly independent, not beholden to MLA or any other service delivery company for contract work.

Mr Quilty’s critique of MLA’s herd forecast was published on Wednesday last week, following an article published by Beef Central a day earlier where we asked MLA to expand on its herd survey methodology and conclusions. MLA personnel congratulated Beef Central on the substance of that article.

“Unfortunately such comments by analysts makes great fodder for media grabs, but they create a whole bunch of unnecessary fear and anxiety,” Mr Strong said about Mr Quilty’s analysis.

“What we actually see at the moment is an increasing beef herd, bigger than we’ve seen for a long time, but it’s a result of the improved seasonal conditions and productivity. But also the industry has demonstrated it is always willing and able to respond to opportunity, as well as challenge.”

“Our relationships with international markets is much more sophisticated than it has ever been before. Our end users are largely focussed on purchasing beef from us which is high quality and consistent, and they rely on continuity of supply.”

The inference that there was going to be a breakdown in those supply chains because people perceive there is going to be an increase in supply of product does not really stack up against recent experience, he said.

Go back to the 2018-19 period when we processed more than eight million head a year. While it was the largest proportional turnoff seen in recent history, livestock prices maintained above five-year averages.”

“So there’s actually nothing to support those sort of comments, except someone’s desire to get themselves into the media, get a media grab, and create fear and anxiety amongst the industry. This is pretty disappointing, given how successful the industry has been in recent times, and the effort put into to establish a long-term, secure and profitable industry.”

Sheep flock projections questions

In response to a request from Beef Central’s sister publication, Sheep Central, for comment around the sheep flock estimates following the release of MLA’s 2023 Sheep Projections a few days after the beef equivalent, MLA issued the following statement.

“MLA’s sheep projections model utilises over 50 years of Australian Bureau of Statistics (ABS) data on the demographics of Australia’s sheep flock, including breakdowns into categories for ewes, lambs, and other sheep.

“The model is also underpinned by records back to 1900 in relation to El Nino and La Nina weather events from the Bureau of Meteorology (BOM), as well as 50 years of BOM rainfall data at a national level.

The 2023 sheep forecasts are based on all sheep enterprises in the country, not just those with an Estimated Value of Agricultural Operations (EVAO) over $40,000 per annum – the ABS only counts enterprises with a turnover of greater than $40k.

The ABS have themselves noted that their data and its reliability has been significantly affected due to a reduced set of agricultural and productions stats, therefore Mr Quilty’s argument should be considered with caution. Click this link for information about removal notification on the ABS website about their data.

Beef Central clearly referenced these significant ABS changes in our previous article on Tuesday last week.

Australian Wool Innovation’s forecasts for the 2022 flock size was 74.6m head, MLA said, which was was 1.9pc or 1.42 million head lower than MLA’s 2022 flock size forecast.

This demonstrated that AWI, the other major sheep R&D and marketing body, was closely aligned with MLA’s forecast, MLA said.

In the October wave of the revamped and redeveloped Sheep Producer Intentions Survey, 46pc of Australian sheep producers expected to increase their flock size and a further 28pc expected their flock size to remain the same from 2022 to 2023. 47pc of producers with a flock size of 20,000 or more expected to increase numbers. All of the above figures indicate significant alignment with MLA forecasts for increase in flock numbers this year.

In summary, Mr Quilty’s recent commentary about the total sheep flock and cattle herd size is inaccurate and should be scrutinised. MLA said.

 

Read Sheep Central’s  separate report published today on debate over flock size estimates.